Platforms

Question 1

What is a Platform? Give an example.

Answer 1

A platform is IS/IT that means other businesses can connect with you and build products and services to create value. An example is Google’s ‘Android’ which allows others to build upon the software through its functions such as app development.

Question 2

Give examples of traditional platforms:

Answer 2

A shopping centre to link consumers and merchants all in one place.
Newspapers connect advertisers with its consumers.

Question 3

How have platforms changed with IT/IS?

Answer 3

IT has hugely reduced the need to own physical assets.
It has made building and scaling platforms much simpler.
Data collection a lot easier online.
Through the internet people can participate from everywhere.

Question 4

What is the traditional business model?

Answer 4

Production distribution marketing consumer. Value is created upstream and consumed downstream.

Question 5

What is the platform model?

Answer 5

A platform allows stakeholders to contribute to the platform and generate value non-linearly. An ecosystem of devs, publishers, content owners, retail and services.

Question 6

What are the key features of a platform?

Answer 6

The platform is owned and governed by this owner.
Providers give the platform an interface (e.g. different phone brands have different looking ‘android’).
Producers can add to a platform.
Consumers use these.

Question 7

Give an example of when a platform has taken over a market:

Answer 7

In 2007 five major mobile-phone manufacturers controlled 90% of the industries profits. By 2015 Apple controlled 92%. Apple used iOS to connect developers and consumers. As each side grew demand was created. In 2015 the app store offered 1.4 million apps not developed by Apple. Apple made $10bn.

Question 8

Give another example:

Answer 8

Airbnb’s value in 2016 was nearly as much as Marriott’s which took 88 years to build.

Question 9

What is the network effect?

Answer 9

When a service or product becomes more valuable as more people use it. e.g. App store.

Question 10

What are the 3 basic step for moving from ‘pipeline’ to ‘platform’?

Answer 10

1. From control to orchestration.
2. From internal optimisation to external interaction.
3. Focusing on ecosystem value instead of customer value.

Question 11

How is platform success determined?

Answer 11

Connection (how easily can others share and transact).
Gravity (how attractive is your platform to producers and consumers?).
Flow (how well the platform exchanges value).